Szulik Says Red Hat Will Have Half of Enterprise Servers by 2015

Lora Bentley

Red Hat's gunning for Microsoft in the enterprise server market, according to Charlotte.com. And CEO Matthew Szulik predicts the Linux distributor will catch up by 2015.

 

He stakes his claim on what the story calls "a global shift" of businesses toward the open source software model.

 

Yes, open source is gaining influence. Open source code will be part of at least 80 percent of commercial software offerings by 2010, according to Gartner Research. Moreover, IDC projects that Linux-based software subscriptions will jump 17 percent per year through 2010, according to Charlotte.com. Since that's how Red Hat makes its money, the company is in a good position to grow.

 

However, observers quoted in the story have varying perspectives. Some say Szulik's prediction is a gutsy one, presumably because Red Hat currently holds less than 20 percent of the market. Soleil Securities analyst James Gilman notes:

I think it would be difficult. ...They would have a long way to go.

Moreover, as Charlotte.com reports:

Al Gillen, vice president of operating system environments for IDC... said Red Hat is doing a better job than Microsoft in capturing new business as it comes up for grabs. But the company has been largely unable to steal business directly from Microsoft.

On the other hand, Brendan Barnicle of Pacific Crest Securities calls Szulik's prediction "interesting," but concedes that Red Hat's CEO could be more right than wrong.


 

Given his recent comments on a conference call, the story says, Szulik undoubtedly likes the company's chances:

Red Hat is sitting here with $1.2 billion in the bank and an economic model that's throwing off 40-percent [growth] in sales and cash flow.... If you can find another economic model throwing off that kind of cash, then buy the company.


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Oct 8, 2007 10:36 AM Rex Ballard Rex Ballard  says:
With Red Hat, Novell, and Sun all gunning for 51% of the market each, there won't be much left for Microsoft.Numbers can be deceiving. Very often, a single Linux machine or UNIX machine can do the work of 6-8 Windows machines. With SMP, NUMA, LPARs, Virtualization, and library optimization and sharing, a PPC based Linux or AIX system can pump a few gigabytes/second, while a similarly configured Windows pipeline might only do a few hundred megabytes per second due to latency, memory contention, garbage collection, and context switching overhead.Microsoft is often used as a peripiheral or gateway server, connecting one .NET server in one company to another .NET server in another company. In many cases, these "Modem" servers are then integrated to the "Big Iron" which might be a single 64 core Linux or AIX server, or a 128 blade grid of Linux servers.I am often fascinated when someone tries to count a blade cabinet or 64 core server as 1 unit, and also count a 1U single chip dual-drive rack mount server as 1 unit and attempt to claim that Microsoft has the "Lead".The more amusing thing is when Microsoft is attempting to claim leadership by dollar volume. In effect, they are demonstrating, at a macro level, that Linux has far better TCO than Windows. If I need twice as many Windows servers, and Microsoft getting 4 times the revenue per box, compared to Linux, doesn't this mean that I can get 8 times the performance for the same amount of money, by using Linux? Reply
Apr 22, 2008 8:24 AM manmath sahu manmath sahu  says:
Szulik is partially right! Linux Servers definitely have a great chance of domination, but then RedHat is not the only, there is Novell and Mandriva in the run. Who knows the other two will encroach RedHat's territory sooner or later..... Reply

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